Your comments - credit unions better than you might thinkLatest responses to “Credit unions - better than you might think”Copyright 2015, MoneyBlueBook.comMichael Calcutt says: 4092202010-10-29T23:10:26-07:00Michael CalcuttHi Gina,
Below is my description this past year with my local St. Paul MN Federal Credit Union. There is a difference and I implore you to investigate how safe peoples money is with Credit Unions. Here is my story.
Affinity Plus Credit Union St. Paul, MN has acknowledged that an unauthorized wire transfer (through the Fed wire system) totaling nearly $89k was sent this past February from my savings account (the actual funds came from my HELOC, but were first transferred into my saving). After five months they concluded their investigation and ruled that they had followed Uniform Commercial Code (UCC) and are not responsible for having sent the two wires. They stated that they followed their internal procedures by asking and confirming the information on the account (this amounted to a SS# and DOB).
My understanding is that Uniform Commercial Code has very broad guidelines but falls under Reg 4a. It is this regulation that banks must follow and this is where I need to gain a further understanding. I have been unable to find anyone with expertise in this area.
I would like to explain below how the CU handled this transaction:
My HELOC account was opened in February 2009. Approximately one year later, my telephone banking system was activated by the perpetrator (this system had never been used in the 7 years of being a member with the CU). Three days later using the telephone banking system, my telephone number on the account was changed. Over the next four days a total of nine (9) transfers of $9,999.00 from my HELOC to my savings account took place. On the first day of fund transfer and again two days later a fax request was sent to the CU requesting the wire transfer of funds to BofA.
The CU indicated to me that they incorporated the following procedure before wiring the funds:
-Called the new telephone number on the account.
-Verified the signature (my signature was copied from a closing document a year earlier by the perpetrator).
-Verified my SS# and DOB.
What the CU did not do:
-Did not notify me that my telephone banking system was activated or that my telephone number was changed two days prior to the wires being sent.
- They did not consider calling the new telephone number to verify that the new number was valid.
- On each day of the two wire transfers, they did not consider that numerous phone transfers of $9,999.00 also took place into the savings account (again the telephone banking system was used).
-Did nothing to consider the unusual telephone number and different name on the top of the two (2) faxes that were sent to them (the fax number next to the name was almost identical to the new telephone number established on the account).
- Did nothing to realize the signature was an exact cut and paste.
It is worth noting that I notified the CU within 3 weeks of the wire transfers. With all of the items which they ignored as noted above, there has to be some level of protection for the consumer. I know with banks this issue would be resolved!
Mike Calcutt
612.298.0069